Medicare Supplement Plans – All you need to know

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Type Description Cost Phone Number
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A Medigap plan is a private insurance policy that can help you pay for some of the out-of-pocket costs associated with traditional Medicare and sometimes additional services. You must pay a premium for Medigap insurance in addition to your Medicare Part B premium and Medicare Part D prescription drug premium.

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Medigap plans are designed to supplement Medicare coverage. There are a variety of different Medigap plans, and each one is identified by a letter. You’ll find Medigap plans including A, B, D, G, K, L, M and N. Each plan is set up to provide a different level of supplemental coverage to Medicare. “Different plans cover different things,” says Lev Barinskiy, CEO of SmartFinancial.com, an insurance comparison website. To see the exact benefits for each plan, it can be helpful to look at a plan comparison website, such as the one provided at Medicare.gov.

Medigap plans only cover one person, so if you’re married, you and your spouse will need to purchase separate policies. The plans do not cover prescription drugs, hearing aids, vision services, dental care or long-term care.

Medigap policies are standardized, and each insurance company must offer established benefits for each plan. This means a Medigap plan with a given letter will be the same anywhere you buy it. “The only difference is the price,” says John Hill, president of Gateway Retirement in Rock Hill, South Carolina. “In every state, there are many companies offering the same coverage at a different price.”

You can sign up for a Medigap plan during the six months after you enroll in Medicare Part B. During that time, you can purchase any Medigap policy that is sold in your state. Even if you have health problems, it’s guaranteed that you’ll be accepted, and insurers won’t charge you more based on your medical conditions during this initial enrollment period.

After six months have passed, you will no longer have the guarantee that your application will be accepted. Insurance companies might not grant you a Medigap policy if you have certain health conditions. Even if you are able to buy a Medigap plan, it may cost more.

Medigap policies are extra insurance you can buy if you have Medicare. These plans are designed to help pay for some of the costs that are not covered by Medicare Part A and Medicare Part B. “Original Medicare leaves deductibles, copays and coinsurance behind for the beneficiary to pay for approved medical care and services,” says Danielle K. Roberts, co-founder of the insurance agency Boomer Benefits in Fort Worth, Texas. With a Medigap policy, you could potentially save thousands of dollars in medical bills.

To qualify for Medigap, you’ll need to have Medicare Part A and Medicare Part B. In general, individuals who are 65 and older are eligible for Medicare. If you have a Medicare Advantage plan, which is sometimes referred to as Medicare Part C, Medigap coverage is not available.

In the confusing world of Medicare, it is important to know one plan from another. There are many supplemental insurance plans that aren’t Medigap. According to CMS, these include:

  • Medicare Advantage Plans (like an HMO, PPO or private fee-for-service plan).
  • Medicare prescription drug plans (Medicare Part D).
  • Medicaid.
  • Employer or union plans, including the Federal Employees Health Benefits Program.
  • TRICARE.
  • Veterans’ benefits.
  • Long-term care insurance policies.
  • Indian Health Service, tribal and urban Indian health plans.

Medigap policies are sold separately from Medicare and are offered by private insurance companies where you live. Like any insurance policy, these require you to pay a premium to the provider. Premiums are usually $100 or more each month, and they go up as you age, Shea says.

If you are interested in a true Medigap plan, the best time to buy one is when you’re first eligible, during your six-month Medigap open enrollment period. This begins the month you turn 65 and enroll in Medicare Part B, Omdahl says, and during this period, “You generally will get better prices and more choices among policies.” Once this period ends, you may be ineligible to buy a Medigap policy, depending on your state regulations. And even if you are eligible, it may cost you more if you have a current or past health condition, she says.

Like other insurance policies, Medigap policies, which are known by different letters, such as Plan A or Plan G, cover different services. For example, some Medigap policies also cover services that Original Medicare doesn’t cover, like medical care received outside the U.S. But most Medigap policies don’t cover services like dental care, vision care, long-term care, private nurses or some medical equipment like hearing aids and eyeglasses.

Unlike Medicare, which is a federally regulated system, Medigap plans are state-regulated. “Most states have standardized Medicare supplement plan designs. In those cases, there are only two things different about any Medicare supplement plan letter,” Shea says, “the price you pay every month and the company that offers the coverage. The benefits and the coverage rules are the same.”

If you have Original Medicare and you buy a Medigap policy, Medicare is first in line to the approved amount for covered health care costs. After that, the Medigap policy pays its share. Typically, Medicare will send the insurance company underwriting your Medigap policy your claim information, then pay the doctor directly, Omdahl explains.

The Medicare plans represented are PDP, HMO, PPO or PFFS plans with a Medicare contract. Enrollment in plans depends on contract renewal.

We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800- MEDICARE (TTY users should call 1-877-486-2048) 24 hours a day/7 days a week to get information on all of your options.

Not all plans offer all of these benefits. Benefits may vary by carrier and location. Limitations and exclusions may apply.

Not affiliated with or endorsed by any government agency.

Every year, Medicare evaluates plans based on a 5-star rating system.

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